The metaverse, a concept referring to a shared, immersive virtual environment, has become one of the hottest business trends: tech giants including Facebook, Google and Microsoft have all jumped on the bandwagon, and investors are helping fuel the momentum, having poured more than US$10 billion into related startups in 2021 alone, data from Crunchbase show.
Research firm Emergen Research estimates that the market for metaverse technologies, which includes gaming and virtual reality (VR) headsets, reached US$48 billion in 2020 and will grow by more than 40% each year between 2020 and 2027.
The frenzy surrounding the metaverse has led to a thriving ecosystem of young players looking to tap into the opportunity and provide the building blocks for immersive virtual environments. Here we’ve compiled a list of five must-follow startups from Asia that have witnessed strong traction and made notable strides over the past year, and which are worth keeping a close eye on in 2022.
The Sandbox (Hong Kong)
A subsidiary of Animoca Brands, The Sandbox is a leading decentralized gaming virtual world. The Ethereum-based platform lets players “play, create, own, and govern a virtual world.” Players can own in-game assets in the form of non-fungible tokens (NFTs), such as plots of land that they can build on.
The Sandbox closed a US$93 million Series B funding round led by SoftBank in November 2021 after witnessing tremendous growth in 2021 and generating a total of US$144 million in gross merchandise volume (GMV).
Over 165 brands, including Snoop Dogg, The Walking Dead, The Smurfs and CryptoKitties, have formed partnerships with The Sandbox. High profile land owners in the virtual environment include Zed Run, Republic Realm, Binance, the South China Morning Post, Zepeto, the Winklevoss twins, and Bill Lee of Craft Ventures.
Earlier this month, The Sandbox announced that it had added multiple Hong Kong partners to create Mega City, a new cultural hub. These partners include Hong Kong tycoon Adrian Cheng, alternative investing leader Sun Hung Kai & Co, and professional services firm PwC Hong Kong.
Zepeto (South Korea)
Zepeto, a product of Naver Z, allows users to play games, communicate with others through 3D avatars, as well as make money through the production of fashion items and other content.
Zepeto boasts 250 million accumulated users globally, 1.5 million creators and 50 million item sold. The startup has previously collaborated with fashion brands including Gucci, Dior, Nike and Ralph Lauren, which have released virtual collections on the metaverse. Popular K-pop groups such as Blackpink, ITZY and SF9 have also held virtual events or issued exclusive content on the platform.
In late 2021, Naver Z raised about 223.5 billion won (US$189 million) in a Series B funding round to expand Zepeto overseas after setting up its US unit in September 2021. In December 2021, Naver Z formed a joint venture with game developer Supercat called Zep to provide companies with virtual office space.
Axie Infinity (Singapore)
is a blockchain-based gaming metaverse developed by Sky Mavis, a startup headquartered in Singapore. The game is centered around collectible digital pets that can be bred, battled and traded. These digital pets come in the form of NFTs. The metaverse includes play-to-earn opportunities, providing some users with regular income. The digital ecosystem attracts some 2 million users per day.
In October 2021, Sky Mavis raised US$152 million at a nearly US$3 billion valuation to help it grow its Axis Infinity game. The fundraising came just a few months after the startup closed a US$7.5 million Series A round. With a market capitalization of US$4.1 billion, the Axie Infinity token is the second largest crypto token in the metaverse category, according to data from Coinmarketcap.
Founded in 2009, Enjin is a blockchain company specializing in NFT solutions. The startup has developed a full ecosystem of blockchain software products and solutions that enable developers, businesses, and individuals to create, manage, trade, distribute, and integrate Ethereum-based NFTs.
Enjin is developing Efinity, a blockchain-based ecosystem built on Polkadot intended to serve as the infrastructure for a decentralized, cross-chain metaverse. Efinity is currently in internal alpha stage.
Last year, Enjin announced it had formed the Efinity Metaverse Fund. The fund seeks to raise US$100 million to support the growth of Efinity and support work related to NFTs, decentralized applications (DApps) and gaming. With a market capitalization of US$1.8 billion, the Enjin Coin is the fifth largest crypto token in the metaverse category, according to data from Coinmarketcap.
GuildFi is a Thai startup that aims to develop a Web3 infrastructure to connect games, NFTs, and communities to maximize players’ benefits and enable interoperability across the metaverse.
The platform has attracted more than 100,000 registered users, and 25,000 daily active users. Last year, it closed a US$6 million seed round co-led by DeFiance Capital and Hashed. The round also included backing from the likes of Pantera Capital, Coinbase Ventures and Dapper Labs.
GuildFi is currently working on a number of new features including GuildFi ID, a metaverse ID that will be embedded with a levelling system to track players’ achievement and footprint across the metaverse, Game Discovery, which will help players discover curated games and game creators, and Proof-of-Play Rewards, which will enable play-to-earn on any game.
Featured image credit: background edited from Freepik